Investing in the right policy is necessary before opening your doors
- Opening a small business is a lot of work
- You’ll need insurance before you open
- Multiple business insurance types could be necessary
- Even home-based businesses need coverage
Creating a company from scratch requires significant work, and the process could leave you feeling overwhelmed. It’s easy to overlook certain aspects of opening a business when you’re swamped, but insurance is one thing you must never forget.
Businesses of all sizes need insurance. You never want to find yourself in a situation where an unforeseen problem arises and leaves you paying out-of-pocket to replace company assets or handle claims. The expenses in this scenario could be enough to sink your business before you even get off the ground.
Your insurance policy should be one of your first priorities when starting a company. The protection your policy provides is extremely valuable and could be the only reason your venture survives into the future. Here’s a look at the importance of new small business insurance for your organization.
When to purchase small business insurance
As you work through the process of starting a business, you might find yourself wondering: when do I need insurance for my new company? The reality is that you’ll want to have your policy in place before you open your doors, and possibly prior to purchasing merchandise or equipment.
Why? Because your policy will protect your inventory and equipment from damage or theft, even if your storefront isn’t open. For instance, if your merchandise gets stolen from a warehouse or damaged during delivery, your business insurance policy ensures you don’t have to pay out of pocket for replacements or repairs. The result is a smoother opening for your business, even if everything doesn’t go according to plan.
Why you need insurance coverage
There are dozens of reasons why you need small business insurance coverage. Companies all over the country deal with claims for various reasons every day – and you might not even think about many of them until it’s too late. So having a policy in place that protects against the unexpected is crucial.
One reason to invest in insurance is the possibility of theft. No matter your business type, theft is a concern because criminals are always looking to separate you from your assets. Not all theft is external, either, as employee theft is a common problem that affects 75% of American businesses and costs business owners $50 billion annually.
Next, your insurance policy offers protection against damage. This damage can occur to your property, equipment, merchandise, and other assets, and it could be caused by fires, vandalism, human error, cyberattacks, or employee negligence. Having the necessary coverage can save you significant costs, especially if your property sustains damage.
Finally, your insurance plan should protect you and your company against lawsuits. Lawsuits can arise when an employee or customer is injured on your property, and the business is at fault for the situation. Data breaches and faulty products or services could also open you up to potential suits against your organization.
Making sure you have business insurance covering these three main concerns can keep your company out of financial peril. There are multiple types of small business insurance that are worth looking into to ensure you have adequate coverage moving forward.
Types of business insurance
Your business type will help determine the insurance coverage you need. Learning about each insurance plan can help you choose the policies you need to protect your company against nearly any situation that might arise.
General liability insurance is applicable for nearly every business because it provides coverage if you’re responsible for a customer’s injury or damage to their property. This insurance can also cover you if a client accuses you or a team member of libel or slander or believes your company is guilty of copyright infringement. Your policy will cover settlements, judgments, and legal fees, saving you considerable expenses.
Commercial property insurance is another standard policy you may want to consider because it protects your building and all the physical items you need to continue operations. These items can include equipment, tools, furniture, and inventory. Commercial property insurance is important even if you’re just leasing office space because it covers your assets.
Workers’ compensation insurance is mandatory in Florida because it pays for your employees’ medical expenses and wages if they’re injured on the job. Sole proprietors can also invest in this insurance in case they’re injured while working. In this situation, workers’ compensation would cover you for things that health insurance overlooks.
Professional liability insurance could be necessary if you perform work for clients. It covers you if a client accuses your company of making a mistake or failing to deliver on a business arrangement that costs the client money. Your insurance policy would cover settlements, judgments, and legal fees in this situation.
If your employees take tools or equipment to job sites, you’ll need additional insurance coverage. Business equipment insurance will help pay if this equipment is lost, stolen, or damaged. And a commercial auto insurance policy is also necessary if employees use company vehicles for work-related reasons.
There’s also an option for home-based business insurance if you conduct all your company’s operations from your house. This policy is typically added to your home insurance plan to cover your equipment and inventory. It can also include liability coverage if customers will be visiting your home.
Taking the time to understand these insurance policies is important because of the protections they offer. The more you know about new small business insurance, the easier it becomes to invest in the right plan.
How to find the plan you need
Business insurance is necessary for all small businesses because too much can go wrong without it. Failing to secure a strong enough plan could leave you with significant expenses if something unfortunate happens – and most small businesses can’t withstand those costs. Speaking with an insurance agent ensures that you have all the information you require before purchasing new small business insurance.
Avante Insurance offers policies for companies of all sizes. Our team will answer all of your insurance-related questions, putting you on the right track as you protect your new business. Contact Avante Insurance for more information on new small business insurance in South Florida.
This blog and website are made available by the publisher for educational and informational purposes only. It is not to be used as a substitute for competent insurance, legal, or tax advice from a licensed professional in your state.